Asian equity markets tumbled to one-month lows on Tuesday, led by sharp selloffs in Japan and South Korea, as investors grew increasingly uneasy ahead of Nvidia’s earnings later this week—a key test for towering valuations across the global tech sector.
Japan’s Nikkei slid 3% and was on track for its steepest one-day drop since April, while futures tied to major European indices also fell more than 1%. Bitcoin, often viewed as a barometer of market sentiment, dropped below $90,000 for the first time in seven months. The broad MSCI Asia-Pacific ex-Japan index sank 1.8% to levels last seen in mid-October, with South Korea’s KOSPI plunging 3.3%, Australia’s ASX200 nearly 2%, and Hong Kong’s Hang Seng down 1.67%.
Market participants said the decline reflected fading confidence rather than any single catalyst. Tareck Horchani of Maybank Securities described the downturn as a sign that investors are becoming increasingly sensitive to valuations after months of relentless gains. He noted that positioning fatigue and a sense that the rally needs a breather are weighing on sentiment across the region.
The slump in Asia mirrored an extended selloff on Wall Street, where traders are bracing for a heavy slate of economic data. Besa Deda, chief economist at William Buck, said November has brought greater volatility to global equities, with most major indices stalling after failing to reach new highs seen earlier in the year.
Nvidia’s quarterly results, due Wednesday, loom large over markets as investors search for clues about the health of the semiconductor and AI supply chain. A basket of Japan’s AI-linked stocks tracked by BNP Paribas fell 4.7% during Tuesday’s session, deepening its monthly loss to roughly 15% after soaring 130% between January and October. Jason Lui of BNP Paribas said investors are becoming more selective as they scrutinize the sustainability of AI-related spending both in the U.S. and across Asia.
Safe-haven currencies benefited from the risk-off tone. The dollar, yen, and Swiss franc saw fresh buying, with the franc trading just stronger than 0.80 per dollar. The yen edged 0.15% higher to 155 per dollar, offering limited relief for Japanese officials who have grown increasingly vocal about concerns over currency weakness.
Japanese government bonds also sold off heavily, sending long-term yields to record highs amid fears over Prime Minister Sanae Takaichi’s expansive fiscal plans. Markets were closely watching her meeting with Bank of Japan Governor Kazuo Ueda—the first since her inauguration—as questions mount over the timing of the central bank’s next rate move. While Ueda has hinted at the possibility of a hike as early as next month, government leaders have emphasized their desire to maintain low rates until inflation firmly meets the BOJ’s 2% target. Tai Hui of JPMorgan Asset Management said he expects any further rate increase to be delayed until 2026, citing the BOJ’s conservative stance.
Commodities were also under pressure. Gold slipped 0.87% to $4,008 an ounce, Brent crude dropped 0.67% to $63.77 a barrel, and bitcoin fell nearly 2% to break below $90,000, extending a decline that has left it roughly 30% below its recent peak.
